FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : HANGAR DOORS (REPRESENTED BY MANAGEMENT SUPPORT SERVICES (IRELAND) LIMITED) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Hayes Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Redundancy
BACKGROUND:
2. The Company manufactures roller shutters and doors at their plant at Kingscourt, Co. Cavan. Due to the current downturn in the Construction Industry the Company is loss making for the past two years and is proposing to restructure and make redundant approximately half of it's Workers in order for the Company to survive. The Union had agreed earlier this year to a temporary pay cuts ranging from 15% to 25% on the basis that these should not be included in the calculation of the redundancy package.
The dispute could not be resolved at local level and was the subject of a Conciliation Conference under the auspices of the Labour Relations Commission. As agreement was not reached, the dispute was referred by both parties to the Labour Court on the 8th June, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 10th June, 2010.
UNION'S ARGUMENTS:
3. 1. The Union understands the exceptional financial difficulties the Company finds itself in, but it must comply with the terms as set out in the Collective Agreement and initially seek only Voluntary Redundancies as a first step.
2. If the above fails to produce the targeted number required then the Company should implement the selection terms strictly on the seniority principle (lifo).
3. Discussions should take place between the parties regarding the enhanced redundancy package.
4. The Union states that no discussions have taken place between the Company and Union on new terms and conditions of employment.
COMPANY'S ARGUMENTS:
4. 1. This is a genuine restructuring / redundancy situation and any ex-gratia payment would render the Company unable to raise working capital in order for the Company to remain in business.
2. The Workers are willing to make the necessary sacrifices in order to ensure the continuation of employment as evidenced by the number of applicants for new positions on offer.
RECOMMENDATION:
The Company and the Union entered into a comprehensive agreement in 2003 that regulates the conduct of industrial relations between the parties. That Agreement contains provisions dealing with all of the issues in dispute viz. Redundancy Terms (Section 10), Selection for Redundancy (Section 45) and Variation to terms and conditions of employment (Section 11).
The burden of justifying a departure from the terms set out in the Agreement falls on the party seeking to do so. The procedure to be followed in effecting such a change to or departure from the Agreement is set out in Section 11 thereof.
In light of the submissions made and the evidence presented in the course of the hearing and taking into account the terms of the Collective Agreement, the Court recommends as follows
1) That the parties meet in intensive discussions over a two week period to agree redundancy terms appropriate to the circumstances of the company and the reasonable and legitimate expectation of the Workers involved. In this regard the Court notes the stated willingness of the Union to agree to a significant variation to the terms set out in Section (10) of the Collective Agreement.
2) That the Company offer the resulting redundancy/severance package to all staff seeking volunteers who are prepared to terminate their employment on the terms offered. If, following this process, compulsory redundancies are necessary the Company should apply the terms of Section 45 of the Collective Agreement. If the Employer wishes to retain staff with key skills out of turn, it must discharge the burden of proving that retaining the excepted person and skill, taken together, is reasonable, proportionate and necessary to meet the identified and legitimate needs of the Company.
3) The parties should meet, within the two weeks alluded to above, and seek to agree new terms and conditions of employment appropriate to the commercial needs of the Company.
If after two weeks any matters remain outstanding the Court will, if the parties so agree, reconvene the hearing and issue a final Recommendation on the substantive issues.
The Court so recommends.
Signed on behalf of the Labour Court
Brendan Hayes
11th June, 2010______________________
JFDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.